OPTION 2: ADDITIONAL INCOME SOURCES

Many people turn to a high-cost loan for a large one-time expense. This section includes ways to access additional income without increasing your debts. Before turning to a loan, consider these sources of potential income.

woman saying "Yes!"

Tip! Free and Discounted Essentials

Many charities provide free food, free clothing, and other essentials. Catholic Charities locations across Illinois offer assistance regardless of your religion. A financial coach can also help direct you to resources.

Tax Refunds/Credits

You could be eligible for thousands of dollars in tax refunds by filing your taxes. Even if you don’t normally file taxes, you can still file. The filing deadline was April 18, 2022, but there is no penalty for filing late if you don’t owe the IRS any money. File as soon as possible to get your refund.

If you received monthly, advance payments of your Child Tax Credit in 2021, you are probably eligible for the Child Tax Credit in 2022, which you can receive by filing your 2021 income taxes. If you did not enroll in the monthly advance payments of the Child Tax Credit, you can still claim the full amount that you qualify for by filing your 2021 income taxes.

If you haven’t received one or more stimulus checks that were issued in 2020-2021, you may claim the Recovery Rebate Credit on your taxes to receive it. Many low-income people are also eligible to receive money from the Earned Income Tax Credit (EITC). Learn if you are eligible for the EITC.

Filing your current year taxes online and using a bank account number for direct deposit will help you get the money much more quickly. If you didn’t file taxes in the last two years but think you might be eligible for these tax credits, you can still file a paper return for those years to receive your past refunds.

Many Americans are eligible for free, online tax-preparation services. Most programs to help people file taxes for free are available from January to October.

  • Visit GetMyPaymentIL.org to learn more about how to file your taxes for free and get your Recovery Rebate Credit. They have a hotline (888-553-9777) for people without computer access or more complicated tax questions.
  • The AARP Foundation’s Tax-Aide program provides free tax preparation assistance to people over 50 and people with low to moderate income. They offer in-person or virtual assistance across Illinois.
  • In Chicago, Ladder Up offers free tax assistance to eligible families. Ladder Up also has pro bono attorneys available for more complicated tax situations.

Cash Assistance Programs

The Cook County Promise Guaranteed Income Pilot Program is no longer accepting applications. The County hopes to make the program more permanent in the future.

The City of Chicago cash assistance program is no longer accepting applications. The City may launch a future program depending on the outcome of the current one.

COVID-19 Funeral Assistance

The federal government now has a program to reimburse the costs of funerals for deaths attributed to COVID-19 (according to the death certificate). The maximum benefit is $9,000 per burial. To be eligible, the funeral must have occurred after January 20, 2020. For more information, including required documentation, go to their website. To apply, call 844-684-6333 (multilingual services available). They are not accepting online applications.

Paycheck Advance/Early Wage Access

If you are employed, ask your employer for an advance on your next paycheck. There are several apps that offer Early Wage Access (EWA) products. Some of the EWA apps are tricky to navigate – they might try to make you pay a “tip” when you borrow and make it difficult to opt out of the tip, and they might charge you a fee to receive your money immediately. If you are cash-strapped and use these products, we recommend that you tip zero and, if at all possible, skip the optional fee for an immediate payment. Based on our experience, the money should hit your account in less than three business days.

Another important warning: These products work best for people whose income is sufficient to pay for their expenses, but their cash flow is uneven. If you don’t make enough money to pay for your expenses, using these products – or any loan product – to pay for everyday expenses may cause you to fall into cycle of needing to re-borrow every pay period.

Bottom line: If you pay no tip and no “immediate deposit” fee, you can obtain free payday advances from these apps. But, because the advances are repaid at the beginning of your next pay period, they may cause you to get stuck in a cycle of re-borrowing.

Church

Many churches provide financial and other assistance. For example, Catholic Charities agencies across Illinois have financial assistance programs for families regardless of religion.

Tip! Be Wary of Hidden Crypto Fees

Bitcoin and other cryptocurrencies are risky. Their use is expanding – for example, as an alternative to currency exchanges or remesas (remittances) – but be wary of hidden fees and extra costs. There are often hefty fees attached to each stage of the process, from putting your money into a crypto wallet, to buying crypto on one of the exchange marketplaces, to cashing back out – and fees are likely even higher using a crypto ATM.

Savings

Tap into your savings. Chances are you have already exhausted any money in a savings account, but you may also have retirement savings (401k, IRA, etc.). It is never ideal to deplete your savings or tap into retirement accounts, but it is one way to boost your income in a major financial emergency. There are tax consequences, and you may have to adjust how you save for retirement going forward. You may want to consult with a licensed accountant or a certified financial planner.

Sell Assets

If you’re willing to part with an item (i.e., gold jewelry, designer clothes, or antiques) consider selling it rather than getting a pawnshop loan to avoid paying financing charges. Poshmark is a widely used app for this. Most Illinois pawnshops charge around 240% APR for a pawn loan.

Prefer Talking to a Live Person? Ask a Financial Coach.

Capital Good Fund’s financial coaching hotline provides one-on-one financial advice to any Illinois resident. Starting at $15 per month, the nonprofit can create a plan with you and can advocate on your behalf with creditors. They also offer a credit-builder program for $5 per month. Call 866-584-3651 (English or Spanish)

Working Credit NFP is a nonprofit that offers free financial counseling to help you build your credit, understand the credit system, and create a plan to reach your financial goals. Their credit building counseling program includes unlimited one-on-one support and coaching for 12 months for free. Sign up online (English and Spanish).

The City of Aurora’s Financial Empowerment Center provides free, high-quality, one-on-one financial counseling to low-and moderate-income residents of the Aurora region. Learn more.

Many credit unions also offer free or low cost financial coaching. Check with your local credit union to learn about their offerings, and check the list under Option 3: Lower Cost Loans if you need help finding a credit union.

Man getting advice

Acknowledgments

This resource guide is produced in partnership with New America Chicago, Woodstock Institute, and Financial Inclusion for All Illinois.

Special thanks to all the hardworking nonprofits, socially-conscious lenders, and community partners who are helping restore wealth in our communities. Your work is so important! Thanks also to Jane Doyle, Brent Adams, Amy Eisenstein, Vanessa Rangel, Gordon Mayer, Meegan Dugan Bassett, Bob Reddy, Joe Wilkes, LuLin McArthur, and Lauren Monaco Grossman for their work on this project.

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